Text: H.R.5952 — 102nd Congress (1991-1992)All Information (Except Text)

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Union Calendar No. 512
102d CONGRESS
2d Session
H. R. 5952
[Report No. 102-895]
A BILL
To amend the Federal Food, Drug, and Cosmetic Act to authorize prescription
drug application, establishment, and product fees, and for other purposes.
September 22, 1992
Reported with an amendment, committed to the Committee of the Whole House
on the State of the Union, and ordered to be printed
HR 5952 RH
Union Calendar No. 512
102d CONGRESS
2d Session
 H. R. 5952
[Report No. 102-895]
To amend the Federal Food, Drug, and Cosmetic Act to authorize prescription
drug application, establishment, and product fees, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
September 16, 1992
Mr. DINGELL (for himself, Mr. WAXMAN, Mr. LENT, Mr. BOUCHER, Mr. BRYANT,
Mr. HARRIS, Mr. SCHEUER, Mr. STUDDS, and Mr. WYDEN) introduced the following
bill; which was referred to the Committee on Energy and Commerce
September 22, 1992
Reported with an amendment, committed to the Committee of the Whole House
on the State of the Union, and ordered to be printed
[Strike out all after the enacting clause and insert the part printed
in italic]
[For text of introduced bill, see copy of bill as introduced on September
16, 1992]
A BILL
To amend the Federal Food, Drug, and Cosmetic Act to authorize prescription
drug application, establishment, and product fees, and for other purposes.
  Be it enacted by the Senate and House of Representatives of the United
  States of America in Congress assembled,
SECTION 1. SHORT TITLE, REFERENCE, AND TABLE OF CONTENTS.
  (a) SHORT TITLE- This Act may be cited as the `Prescription Drug User Fee
  Act of 1992'.
  (b) REFERENCE- Whenever in this Act an amendment or repeal is expressed in
  terms of an amendment to, or repeal of, a section or other provision, the
  reference shall be considered to be made to a section or other provision
  of the Federal Food, Drug, and Cosmetic Act.
  (c) TABLE OF CONTENTS- The table of contents of this Act is as follows:
Sec. 1. Short title, reference, and table of contents.
Sec. 2. Findings.
Sec. 3. Fees relating to drugs.
`Sec. 735. Definitions.
`Sec. 736. Authority to assess and use drug fees.'.
Sec. 4. Annual reports.
Sec. 5. Sunset.
Sec. 6. Conforming amendments to chapter VII.
Sec. 7. General conforming amendments.
Sec. 8. Animal drug user fee study.
SEC. 2. FINDINGS.
  The Congress finds that--
  (1) prompt approval of safe and effective new drugs is critical to the
  improvement of the public health so that patients may enjoy the benefits
  provided by these therapies to treat and prevent illness and disease;
  (2) the public health will be served by making additional funds available for
  the purpose of augmenting the resources of the Food and Drug Administration
  that are devoted to the process for review of human drug applications; and
  (3) the fees authorized by this Act will be dedicated toward expediting
  the review of human drug applications as set forth in the goals identified
  in the letters of September 14, 1992, from the Commissioner of Food and
  Drugs to the Chairman of the Energy and Commerce Committee of the House of
  Representatives and the Chairman of the Labor and Human Resources Committee
  of the Senate.
SEC. 3. FEES RELATING TO DRUGS.
  Chapter VII, as amended by section 6, is amended by adding at the end of
  subchapter C the following:
`PART 2--FEES RELATING TO DRUGS
`SEC. 735. DEFINITIONS.
  `For purposes of this subchapter:
  `(1) The term `human drug application' means an application for--
  `(A) approval of a new drug submitted under section 505(b),
  `(B) initial certification or initial approval of an antibiotic drug under
  section 507, or
  `(C) licensure of a biological product under section 351 of the Public
  Health Service Act.
For purposes of this paragraph, such term does not include a supplement to
such an application.
  `(2) The term `supplement' means a request to the Secretary to approve a
  change in a human drug application which has been approved.
  `(3) The term `prescription drug product' means a specific strength or
  potency of a drug in final dosage form--
  `(A) for which a human drug application has been approved,
  `(B) which was not approved under an application submitted under section
  505(b)(2) before October 1, 1992, and
  `(C) which may be dispensed only under prescription pursuant to section
  503(b).
Such term does not include whole blood or a blood component for transfusion,
an allergenic extract product, or an in vitro diagnostic biologic product
licensed under section 351 of the Public Health Service Act.
  `(4) The term `final dosage form' means, with respect to a prescription
  drug product, a finished dosage form which is approved for administration
  to a patient without further manufacturing.
  `(5) The term `prescription drug establishment' means a foreign or domestic
  place of business which is--
  `(A) at one general physical location consisting of one or more buildings all
  of which are within 5 miles of each other, at which one or more prescription
  drug products are manufactured in final dosage form, and
  `(B) under the management of a person that is listed as the applicant in
  a human drug application for a prescription drug product with respect to
  at least one such product.
For purposes of this paragraph, the term `manufactured' does not include
packaging.
  `(6) The term `process for the review of human drug applications' means
  the following activities of the Secretary with respect to the review of
  human drug applications and supplements:
  `(A) The activities necessary for the review of human drug applications
  and supplements.
  `(B) The issuance of action letters which approve human drug applications
  or which set forth in detail the specific deficiencies in such applications
  and, where appropriate, the actions necessary to place such applications
  in condition for approval.
  `(C) The inspection of prescription drug establishments and other
  facilities undertaken as part of the Secretary's review of pending human
  drug applications and supplements.
  `(D) Activities necessary for the review of applications for licensure
  of establishments subject to section 351 of the Public Health Service Act
  and for the release of lots of biologics under such section.
  `(E) Monitoring of research conducted in connection with the review of
  human drug applications.
  `(7) The term `costs of resources allocated for the process for the review
  of human drug applications' means the expenses incurred in connection with
  the process for the review of human drug applications for--
  `(A) officers and employees of the Food and Drug Administration, employees
  under contract with the Food and Drug Administration who work in facilities
  owned or leased for the Food and Drug Administration, advisory committees,
  and costs related to such officers, employees, and committees,
  `(B) management of information, and the acquisition, maintenance, and
  repair of computer resources,
  `(C) leasing, maintenance, and repair of facilities and acquisition,
  maintenance, and repair of fixtures, furniture, scientific equipment,
  and other necessary materials and supplies, and
  `(D) collecting fees under section 736 and accounting for resources
  allocated for the review of human drug applications and supplements.
  `(8) The term `adjustment factor' applicable to a fiscal year is the
  lower of--
  `(A) the Consumer Price Index for all urban consumers (all items; U.S. city
  average) for August of the preceding fiscal year divided by such Index
  for August 1992, or
  `(B) the total of discretionary budget authority provided for programs
  in the domestic category for the immediately preceding fiscal year (as
  reported in the Office of Management and Budget sequestration preview
  report, if available, required under section 254(d) of the Balanced Budget
  and Emergency Deficit Control Act of 1985) divided by such budget authority
  for fiscal year 1992 (as reported in the Office of Management and Budget
  final sequestration report submitted after the end of the 102d Congress,
  2d Session).
The terms `budget authority' and `category' in subparagraph (B) are as
defined in the Balanced Budget and Emergency Deficit Control Act of 1985,
as in effect as of September 1, 1992.
`SEC. 736. AUTHORITY TO ASSESS AND USE DRUG FEES.
  `(a) TYPES OF FEES- Beginning in fiscal year 1993, the Secretary shall
  assess and collect fees in accordance with this section as follows:
  `(1) HUMAN DRUG APPLICATION AND SUPPLEMENT FEE-
  `(A) IN GENERAL- Each person that submits, on or after September 1, 1992, a
  human drug application or a supplement shall be subject to a fee as follows:
  `(i) A fee established in subsection (b) for a human drug application for
  which clinical data (other than bioavailability or bioequivalence studies)
  with respect to safety or effectiveness are required for approval.
  `(ii) A fee established in subsection (b) for a human drug application for
  which clinical data with respect to safety or effectiveness are not required
  or a supplement for which clinical data (other than bioavailability or
  bioequivalence studies) with respect to safety or effectiveness are required.
  `(B) PAYMENT SCHEDULE-
  `(i) FIRST PAYMENT- 50 percent of the fee required by subparagraph (A)
  shall be due upon submission of the application or supplement.
  `(ii) FINAL PAYMENT- The remaining 50 percent of the fee required by
  subparagraph (A) shall be due upon--
  `(I) the expiration of 30 days from the date the Secretary sends to the
  applicant a letter designated by the Secretary as an action letter described
  in section 735(6)(B), or
  `(II) the withdrawal of the application or supplement after it is filed
  unless the Secretary waives the fee or a portion of the fee because no
  substantial work was performed on such application or supplement after it
  was filed.
The designation under subclause (I) or the waiver under subclause (II)
shall be solely in the discretion of the Secretary and shall not be reviewable.
  `(C) EXCEPTION FOR PREVIOUSLY FILED APPLICATION OR SUPPLEMENT- If a human
  drug application or supplement was submitted by a person that paid the fee
  for such application or supplement, was accepted for filing, and was not
  approved or was withdrawn (without a waiver), the submission of a human
  drug application or a supplement for the same product by the same person
  (or the person's licensee, assignee, or successor) shall not be subject
  to a fee under subparagraph (A).
  `(D) REFUND OF FEE IF APPLICATION NOT ACCEPTED FOR FILING- The Secretary
  shall refund 50 percent of the fee paid under subparagraph (B)(i) for any
  application or supplement which is not accepted for filing.
  `(2) PRESCRIPTION DRUG ESTABLISHMENT FEE- Each person that--
  `(A) owns a prescription drug establishment, at which is manufactured
  at least 1 prescription drug product which is not the same as a product
  approved under an application filed under section 505(b)(2) or 505(j), and
  `(B) after September 1, 1992, had pending before the Secretary a human
  drug application or supplement,
shall be subject to the annual fee established in subsection (b) for each
such establishment, payable on or before January 31 of each year.
  `(3) PRESCRIPTION DRUG PRODUCT FEE-
  `(A) IN GENERAL- Except as provided in subparagraph (B), each person--
  `(i) who is named as the applicant in a human drug application for a
  prescription drug product which is listed under section 510, and
  `(ii) who, after September 1, 1992, had pending before the Secretary a
  human drug application or supplement,
shall pay for each such prescription drug product the annual fee established
in subsection (b). Such fee shall be payable at the time of the first such
listing of such product in each calendar year. Such fee shall be paid only
once each year for each listed prescription drug product irrespective of
the number of times such product is listed under section 510.
  `(B) EXCEPTION- The listing of a prescription drug product under section
  510 shall not require the person who listed such product to pay the fee
  prescribed by subparagraph (A) if such product is the same product as
  a product approved under an application filed under section 505(b)(2)
  or 505(j).
  `(b) FEE AMOUNTS-
  `(1) SCHEDULE- Except as provided in paragraph (2) and subsections (c),
  (d), (f), and (g), the fees required under subsection (a) shall be paid
  in accordance with the following schedule:
----------------------------------------------------------------------------------------------------------------------------
                                       Fiscal Year 1993 Fiscal Year 1994
                                       Fiscal Year 1995 Fiscal Year 1996
                                       Fiscal Year 1997
----------------------------------------------------------------------------------------------------------------------------
  Subsection (a)(1)(A)(i) fee $100,000                 $150,000
  $208,000         $217,000         $233,000
Subsection (a)(1)(A)(ii)  fee $50,000                   $75,000
$104,000         $108,000         $116,000
                  Fee revenue $12,000,000           $18,000,000
                  $25,000,000      $26,000,000      $28,000,000
        Fee per establishment $60,000                   $88,000
        $126,000         $131,000         $138,000
                  Fee revenue $12,000,000           $18,000,000
                  $25,000,000      $26,000,000      $28,000,000
              Fee per product $6,000                     $9,000
              $12,500          $13,000          $14,000
                  Fee revenue $12,000,000           $18,000,000
                  $25,000,000      $26,000,000      $28,000,000
           Total fee revenues $36,000,000           $54,000,000
           $75,000,000      $78,000,000      $84,000,000
----------------------------------------------------------------------------------------------------------------------------
  `(2) SMALL BUSINESS EXCEPTION- Any business which has fewer than 500
  employees, including employees of affiliates, and which does not have a
  prescription drug product introduced or delivered for introduction into
  interstate commerce shall pay one-half the amount of the fee for human
  drug applications it submits and shall pay the entire amount of the fee
  for supplements it submits. For purposes of this paragraph, one business
  is an affiliate of another business when, directly or indirectly, one
  business controls, or has the power to control, the other business or a
  third party controls, or has the power to control, both businesses.
  `(c) INCREASES AND ADJUSTMENTS-
  `(1) REVENUE INCREASE- The total fee revenues established by the schedule in
  subsection (b)(1) shall be increased by the Secretary by notice, published
  in the Federal Register, for a fiscal year to reflect the greater of--
  `(A) the total percentage increase that occurred during the preceding
  fiscal year in the Consumer Price Index for all urban consumers (all items;
  U.S. city average), or
  `(B) the total percentage increase for such fiscal year in basic pay
  under the General Schedule in accordance with section 5332 of title 5,
  United States Code, as adjusted by any locality-based comparability payment
  pursuant to section 5304 of such title for Federal employees stationed in
  the District of Columbia.
  `(2) ANNUAL FEE ADJUSTMENT- Subject to the amount appropriated, or that
  may reasonably be expected to be appropriated, for a fiscal year under
  subsection (g), the Secretary shall, within 60 days after the end of each
  fiscal year beginning after October 1, 1992, adjust the fees established
  by the schedule in subsection (b)(1) for the following fiscal year to
  achieve the total fee revenues, as may be increased under paragraph
  (1). Such fees shall be adjusted under this paragraph to maintain the
  proportions established in such schedule.
  `(3) LIMIT- The total amount of fees charged, as adjusted under paragraph
  (2), for a fiscal year may not exceed the total costs for such fiscal
  year for the resources allocated for the process for the review of human
  drug applications.
  `(d) FEE WAIVER OR REDUCTION- The Secretary shall grant a waiver from or
  a reduction of 1 or more fees under subsection (a) where the Secretary
  finds that--
  `(1) such waiver or reduction is necessary to protect the public health,
  `(2) the assessment of the fee would present a significant barrier to
  innovation because of limited resources available to such person or other
  circumstances, or
  `(3) the fees to be paid by such person will exceed the anticipated present
  and future costs incurred by the Secretary in conducting the process for
  the review of human drug applications for such person.
In making the finding in paragraph (3), the Secretary may use standard costs.
  `(e) EFFECT OF FAILURE TO PAY FEES- A human drug application or supplement
  submitted by a person subject to fees under subsection (a) shall be
  considered incomplete and shall not be accepted for filing by the Secretary
  until all fees owed by such person have been paid.
  `(f) ASSESSMENT OF FEES-
  `(1) LIMITATION- Fees may not be assessed under subsection (a) for a fiscal
  year beginning after fiscal year 1993 unless appropriations for salaries
  and expenses of the Food and Drug Administration for such fiscal year
  (excluding the amount of fees appropriated for such fiscal year) are,
  or are reasonably expected to be, equal to or greater than the amount
  of appropriations for the salaries and expenses of the Food and Drug
  Administration for the fiscal year 1992 multiplied by the adjustment factor
  applicable to the fiscal year involved.
  `(2) AUTHORITY- If the Secretary does not assess fees under subsection
  (a) during any portion of a fiscal year because of paragraph (1) and if
  at a later date in such fiscal year the Secretary may assess such fees,
  the Secretary may assess and collect such fees, without any modification
  in the rate, for human drug applications and supplements, prescription
  drug establishments, and prescription drug products at any time in such
  fiscal year notwithstanding the provisions of subsection (a) relating to
  the date fees are to be paid.
  `(g) CREDITING AND AVAILABILITY OF FEES-
  `(1) IN GENERAL- Fees collected for a fiscal year pursuant to subsection (a)
  shall be credited to the appropriation account for salaries and expenses
  of the Food and Drug Administration and shall be available in accordance
  with appropriation Acts until expended without fiscal year limitation.
  `(2) COLLECTIONS AND APPROPRIATION ACTS- The fees authorized by this
  section--
  `(A) shall be collected in each fiscal year in an amount which is, or
  which can reasonably be expected to be, equal to the amount specified in
  appropriation Acts for such fiscal year, and
  `(B) shall only be collected and available to defray increases in the
  costs of the resources allocated for the process for the review of human
  drug applications over such costs for fiscal year 1992 multiplied by the
  adjustment factor.
  `(3) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be appropriated
  for fees under this section--
  `(A) $36,000,000 for fiscal year 1993,
  `(B) $54,000,000 for fiscal year 1994,
  `(C) $75,000,000 for fiscal year 1995,
  `(D) $78,000,000 for fiscal year 1996, and
  `(E) $84,000,000 for fiscal year 1997,
as adjusted to reflect increases in the total fee revenues made under
subsection (c)(1).
  `(h) COLLECTION OF UNPAID FEES- In any case where the Secretary does not
  receive payment of a fee assessed under subsection (a) within 30 days
  after it is due, such fee shall be treated as a claim of the United
  States Government subject to subchapter II of chapter 37 of title 31,
  United States Code.'.
SEC. 4. ANNUAL REPORTS.
  (1) FIRST REPORT- Within 60 days after the end of each fiscal year during
  which fees are collected under part 2 of subchapter C of chapter VII of
  the Federal Food, Drug, and Cosmetic Act, the Secretary of Health and Human
  Services shall submit a report stating the Food and Drug Administration's
  progress in achieving the goals identified in section 2(3) of this Act during
  such fiscal year and that agency's future plans for meeting such goals.
  (2) SECOND REPORT- Within 120 days after the end of each fiscal year during
  which such fees are collected, the Secretary of Health and Human Services
  shall submit a report on the implementation of the authority for such fees
  during such fiscal year and on the use the Food and Drug Administration made
  of the fees collected during such fiscal year for which the report is made.
  (3) COMMITTEES- The reports described in paragraphs (1) and (2) shall
  be submitted to the Committee on Energy and Commerce of the House of
  Representatives and the Committee on Labor and Human Resources of the Senate.
SEC. 5. SUNSET.
  The amendments made by section 3 shall not be in effect after October 1,
  1997 and section 4 shall not be in effect after 120 days after such date.
SEC. 6. CONFORMING AMENDMENTS TO CHAPTER VII.
  Chapter VII is amended--
  (1) by striking out in the chapter heading `ADMINISTRATIVE PROVISIONS'
  and inserting in lieu thereof `AUTHORITY',
  (2) by inserting before the section heading for section 701 the following:
`Subchapter A--General Administrative Provisions',
  (3) by redesignating section 702A (21 U.S.C. 372a) as section 706 and
  by inserting it after section 705 (21 U.S.C. 375) and by redesignating
  section 712 (21 U.S.C. 379d) as section 711,
  (4) by moving section 706 (21 U.S.C 376), as in effect on the date of the
  enactment of this Act, to the end of chapter VII, by redesignating the
  section as section 721, and by inserting before the section heading for
  the section the following:
`Subchapter B--Colors',
  (5) by inserting after section 721 (as so redesignated) the following:
`Subchapter C--Fees
`PART 1--FREEDOM OF INFORMATION FEES', and
  (6) by inserting section 711 (21 U.S.C. 379c), as in effect on the date
  of the enactment of this Act, after the heading for part 1 of subchapter
  C and redesignating it as section 731.
SEC. 7. GENERAL CONFORMING AMENDMENTS.
  To conform the Federal Food, Drug, and Cosmetic Act, to the amendments made
  to that Act by section 6(4), the following conforming amendments are made:
  (1) Section 201(u) (21 U.S.C. 321(u) is amended by striking out `706'
  and inserting in lieu thereof `721'.
  (2) Section 301(i)(1) (21 U.S.C. 331(i)(1)) is amended by striking out
  `706' and inserting in lieu thereof `721'.
  (3) Section 301(j) (21 U.S.C. 331(j)) is amended by striking out `706'
  and inserting in lieu thereof `721'.
  (4) Section 402(c) (21 U.S.C. 342(c)) is amended by striking out `706'
  and inserting in lieu thereof `721'.
  (5) Section 403(i) (21 U.S.C. 343(i)) is amended by striking out `706'
  and inserting in lieu thereof `721'.
  (6) Section 403(m) (21 U.S.C. 343(m)) is amended by striking out `706'
  and inserting in lieu thereof `721'.
  (7) Section 408(g) (21 U.S.C. 346a(g)) is amended by striking out `706'
  and inserting in lieu thereof `721'.
  (8) Section 501(a)(4) (21 U.S.C 351(a)(4)) is amended by striking out
  `706' each place it occurs and inserting in lieu thereof `721'.
  (9) Section 502(m) (21 U.S.C. 352(m)) is amended by striking out `706'
  and inserting in lieu thereof `721'.
  (10) Section 520(g)(2)(A) (21 U.S.C. 360j(g)(2)(A)) is amended by striking
  out `706' and by inserting in lieu thereof `721'.
  (11) Section 601(e) (21 U.S.C. 361(e)) is amended by striking out `706'
  and inserting in lieu thereof `721'.
  (12) Section 602(e) (21 U.S.C. 362(e)) is amended by striking out `706'
  and inserting in lieu thereof `721'.
  (13) Section 4(g)(2)(D) of the Poultry Products Inspection Act (21
  U.S.C. 453(g)(2)(D) is amended by striking out `706' and inserting in lieu
  thereof `721'.
  (14) Section 1(m)(2)(D) of the Federal Meat Inspection Act (21 U.S.C. 601)
  is amended by striking out `706' and inserting in lieu thereof `721'.
  (15) Section 4(a)(2)(D) of the Egg Products Inspection Act (21
  U.S.C. 1033(a)(2)(D)) is amended by striking out `706' and inserting in
  lieu thereof `721'.
SEC. 8. ANIMAL DRUG USER FEE STUDY.
  (a) STUDY- The Secretary, in consultation with manufacturers of animal drug
  products and other interested persons, shall undertake a study to evaluate
  whether, and under what conditions, to impose user fees to supplement
  appropriated funds in order to improve the process of reviewing applications
  (including abbreviated and supplemental applications) for new animal drugs
  under section 512 of the Federal Food, Drug, and Cosmetic Act. The study
  shall include--
  (1) an assessment of the overall review process for animal drugs at the
  Center for Veterinary Medicine, including the number of applications
  received, and the average times for interim and final decisions on each
  type of application,
  (2) the current allocation of funds to the animal drug review process,
  (3) recommendations for goals for decisionmaking times on applications
  submitted to the Center for Veterinary Medicine and for additional resources
  required to meet the goals, and
  (4) recommendations for supplementing the resources for the animal drug
  review process through user fees.
  (b) COMPLETION- The results of the study required by subsection (a) shall
  be presented no later than January 4, 1994, to the Committee on Energy
  and Commerce of the House of Representatives and the Committee on Labor
  and Human Resources of the Senate.
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